Monday, 12 September 2016

The (Increasing) Problems With Insurance

Date started: 10/9/16                     Date completed: 11/9/16                     Date first published: 12/9/16

Insurance. Tricky, isn’t it. Do you buy it, or do you not? Sometimes, we don’t have a choice. And sometimes, when the saleswoman’s just been, it feels like we don’t.

The trouble with insurance is that it is, at its heart, essentially a form of gambling, because it’s dominated by ignorance, and involves money, whether anything happens or not. And, in the true tradition of industrialised gambling, the odds are rigged so that the bookie – the insurance company – always wins. Like in ‘conventional’ gambling, stupidity seems to be the name of the game.

Counter-intuitively, insurance actually works best when it’s stupid; by which i mean everyone gets the same odds, because that way it distributes risk away from unsafe people, to whom bad things are going to happen, toward safe people, to whom bad things are not going to happen. I mean, bad things aren’t going to happen to them, so they can afford the payouts, can’t they.

In this, stupid-insurance system, we have a system that works like social-taxation. It redistributes costs from the poor to the wealthy – from the hazardous to the safe. Research has shown that wealth inequality and health inequality go hand-in-hand, as healthier people are freer to develop wealth-returning careers, and to invest in their children, who will invest in their own, and so on. And because they’re healthier they live longer, so have more time to accrue wealth, with which to invest.

And this is where we meet the crux of the insurance system’s failure – healthcare.

Insurance-based systems fail to be compatible with the ideals of universal healthcare, as long as they are not infinitely stupid. I shall explain...

Let’s say you’re a healthy person (and given that most people are congenital optimists, you probably think you are) who wants to pay as little as possible for your health insurance. Well, showing off how healthy you are means the health insurance company will worry less about having to pay money back to you. And so they will charge you less. This is like a bookie offering you longer odds, because you both agree that your horse is less likely to win. Except in this scenario you don’t get more prizemoney, you just pay less for the ticket.

This all sounds beautiful , so far. I’m healthy, so why should i pay more for my health insurance than i absolutely have to? But how much do i have to?

Before we imagine what the situation looks like for an unhealthy person, let’s imagine that you’re a perfectly healthy person. This means that you can be certain that you’re not going to get ill. Well, in this case, the insurance company can be certain that they’re not going to have to pay you any money, ever. Ever, ever, ever. Will  they charge you nothing, in this scenario? Of course they won’t – they’re a bookie – they’ll always charge you something, because they write the rules, and the rules say that overall, they always win. That means a surcharge on every contract.

In fact, generally-healthy people – the ‘worried well’ are the mainstay of an insurance company’s income. The whole purpose of an insurance company is to introduce costs that needn’t exist, just so that the insurance company can continue to exist. They don’t operate for the sake of your health – they operate for the sake of their own, the insurance company’s health.

Now let’s consider the situation in which you’re an unhealthy person.

Let’s say you have a faltering immune system, you’re incredibly clumsy, the lot. You’re a walking (or not walking) disaster area, and the odds of you being involved in an insurance claim some time in the next 24 hours are incredibly short. Almost 1:1. Now what’s the insurance company going to do? Well, because they are almost certain that they’re going to be paying out money to you, every day, they’re going to charge you huge amounts, so that they get more money out of you, than you get out of them. That is the mainstay of their business, after all.

And so, by taking out insurance, you’re taking on the insurance company’s profit margin as an additional cost to yourself, thereby increasing your costs overall.

I hope you’re getting an idea of how much of a gamble insurance is, by playing these scenarios through your mind, if you didn’t already have one. By taking out insurance, you’re essentially saying “i think i’m more likely to get injured/sick than the insurance company thinks i am”. Isn’t it strange, how people can be optimistic one moment, then woefully pessimistic the next?

Let’s go back to the start of this mini-essay, and my point that insurance works best when it’s stupid. In a world where the insurance industry genuinely cared about you, they would want to care about everyone – not just the healthy – they would want to overcharge the healthy ones, to impose a cost on them, in order to redistribute the shitty bits of life away from the people who are charged higher insurance premiums, for being a genetic timebomb, incredibly unlucky, or an 18-year-old boy buying their first car.

“Whinging about your premiums, Ms Jackson? That’s a bit selfish, isn’t it? You’ve been fine all your life, and look to have a bright clear future ahead of you. At least 50 years of it. Whereas Freddie here has one remaining leg, with 17 breaks in it, due to Type I diabetes, and a nasty fall. Now, don’t you think he’s had enough shit in his life, Ms Jackson? Don’t you? That’s right, you can afford the bill much more easily than he can. I’ll tell him you were so gracious. Or would you like him to thank you personally?”

But the insurance industry is not philanthropic. It doesn’t really care about you. You’re a cash cow. So when it wants to know about you, it doesn’t do so so that it can work out whom to redistribute the shittiness of life from and to, but to work out who are the healthy people who can be offered lower charges, while worrying them into thinking it’s worth paying for it at all; and who are the less-healthy people who can be bled through the nose, potentially leaving their family (or the State) to pick up the bill when they eventually die.

This is anathema to the notion of universal healthcare, because it means pricing the most-needy out of the healthcare that they desperately need.

No wonder insurance-based systems tend toward being compulsory. For example, driving insurance. You’re not allowed to say “i’m an 18-year-old boy, i can’t afford it, so i’m not paying” because that would be free-market economics. That’s only allowed to be done by the company – not the customer. Insurance is obligatory.

No wonder younger people in places like northern Europe aren’t even bothering to learn to drive any more. It’s just too expensive. Insurance companies are buying up personal data about us all, surveilled through pharmacies, banks, supermarkets, and wherever else they can; so that they can learn how to target the higher-risk amongst us, to charge us stratospheric fees. And because the law says insurance is compulsory, for anyone who wants to drive a vehicle on a public highway, there’s nothing we can do about it. The only option for such people, is to vote with their feet, and walk. Or cycle. Or walk to the bus/train station. Or sprout wings and fly.

And then there are the exclusions. Oh, FSM, the exclusions!

If you get sick in the wrong way, or in the wrong country, or you crash into a cow, or are subject to some kind of risk that the insurance company hadn’t tumbled to, like weather, then it gets called an ‘act of god’ or something, and they refuse to pay up. Not at all. Not a single penny. And the same can happen, simply because the reams of smallprint contained a disclaimer contradicting the bigprint. Plus, insurance companies are permitted to change their terms and conditions at any time, meaning the insurance you buy might not cover what you needed it for, by the time the ‘product’ (the payout) is due to be delivered!

What’s the point of insurance if you’re not insured?

This is why insurance companies have a long list of exceptions relating to “pre-existing” conditions. Essentially, if you’ve fallen on the wrong side of chance before, they’re not taking any risks with you. And they’re not giving you a rebate, either. In the equine gambling metaphor, this is them deciding that your horse didn't win this race, because it had won a race before.

And then, if it’s medical insurance, the costs you’d thought you’d embraced can turn out to be higher than you’d hoped, because there’s an infinity of middlemen who can just pitch in at any moment, and claim expenses. The bullshit in all of this game-playing and paperwork, by the insurers and their cohorts, is actively hampering the efforts of healthcare professionals around the world, by stressing their patients. Not to mention the docs, who have to come to arrangements with insurance companies, about how their ridiculous paper-pushing games are going to be mediated.

The more ‘intelligent’ insurance becomes, the more of this wrangling there’s going to be, as insurance companies quibble about how much they should pay out, and to whom, for what services, and under what conditions. They're going to do everything they can to maximise your payments to them, while minimising their payments to you. If you think insurance is a nightmare now, then just wait – it’s going to get worse, as personalised contracts become yet more personalised, and the smallprint has to be rewritten for you, with your consent... if not ahead of time, then after the disaster’s hit you! That’s a perfect opportunity to abuse you through the stress you’re already going through.

And how are individuals going to cope, when things gets messy? Only with an army of citizens advice volunteers, ombudsmans and lawyers. The last of these three are likely to add even more expense, to the people who are least able to pay.

This is a system that can only get worse!

Insurance works best when it’s stupid, because it means the arbiters of it – the insurance companies – don’t know how to screw us over as well.

So as a consumer, the only things we can do, are to continue to try to pay as little as possible, and to hunt on other people’s behalves if they’re worse off than us, in preference to ourselves; and to fight for reform – in the way companies are allowed to own and distribute data, the way the insurance companies are allowed to be run, and the extent to which they are allowed to pervade essential services.

As strange as it may seem, the USA now has a semblance of universal healthcare, in the form of Medicare, thanks to Obama. But most of the credit should probably go to the subtle forces of economics and science, that have made insurance more expensive, and alternatives much easier to administer. In the past, federal healthcare (or anything federal, for that matter) has been difficult simply due to the scale of the country. The USA is half a continent, and so it has many of the same problems faced by China. But advancing technology, especially involving the internet, could change this, making it much easier to run a USAian version of the UK’s National Health Service.

Economics might force this to happen. Illness is hugely expensive, and insurance is inflating that cost.

Links and stuff:

Travel insurance gambling

The state of insurance-based private healthcare in Australia

"Some young drivers are faced with quotations of up to £27,000 a year to insure their cars"

"From 1983 to 2008, the share of 16- to 39-year-olds with driver's licenses declined markedly, with the greatest decreases among drivers in their late teens and early 20s, according to a study at the University of Michigan Transportation Research Institute"

"Church told flood damage is not covered by insurance due to it being an 'act of God'"

Ridiculous exceptions also apply to pet insurance too

"More than 3.5 million workplace injuries and illnesses occur each year in the United States, costing an estimated $250 billion annually"

"Using data from the Medical Expenditure Panel Survey and the U.S. Census Bureau, researchers calculated the premiums paid by Americans from 2000 to 2009 and compared them to incomes. They found that insurance premiums rose 8 percent from 2000 to 2009, while household incomes rose only about 2 percent. If those same rates continue during the next two decades, the average cost of a family health-insurance premium will hit half of median household income by 2021 and surpass it by 2033"

The European Court of Justice ruled in 2012 that optional price supplements that "are neither compulsory nor necessary for the purposes of the flight" such as flight insurance must be changed to be opt-in

The additional costs of sharing medical data with extraneous organisations that don't give a crap about patients:

"Health insurer Centene Corp. says it is missing half a dozen hard drives that contain the personal and health information of roughly 950,000 clients, including the names, addresses, birthdates, Social Security numbers, member identification numbers and health information of patients who received laboratory services between 2009 and 2015"

"The UK branch of Zurich Insurance has been fined a whopping £2.28 million after losing details of 46,000 customers, including details of customers’ identities, and in some cases bank account and credit card information, and other financial information. Questions must be asked as to why this sensitive data was not encrypted at the very least"

Adventures in smallprint:

Flight insurance

Tickets to shows, plays, gigs, etc

Faulty plumbing

Hundreds of lives saved by universal healthcare in US already

Inequality: Of wealth and health

Entertainment stuff from the week 5-11/9/16

Hi uniplets,

Something that Brian posted slightly too late for last week's article:

'Freddie Mercury Asteroid'

Massive coincidences. Interesting, aren't they.

'Family welcomed third child born on the same day for third consecutive year'

But how big a coincidence is this really?

Well, clearly it has to be quite unlikely, or it would happen all the time, in a population of 7 billion people, but it's nowhere near as random as it might seem, at first.

Think about it: what determines when a foetus is born, and becomes a baby?

1 - Time of conception
2 - Time to develop in the womb

That's it. So the question really is: if the parents bonked on the same night three years in a row, what's the chance that the three babies would be born on the same day, three years in a row?

Well, to calculate that, all we need is data on the statistical spread of gestational periods in different women, from child to child.

If there is a population of women who have very regular gestational periods, of consistent length, then we can assume that this family of 3s derives from a woman in this population.

{A gestation a few days longer would result in the same birth date, if the conception occurred a few days earlier. This widens the opportunities for such coincidences to happen}

In which case, the only significant opportunity for chance to be involved, is in element 1 - choice of when to have the bonking session.

Now, who wants to ring them up, and ask about that? :-D

As it occurs to me, as it occurs to me, as it occurs to-o me-eee coming back

'As It Occurs To Me: The Return'

I expect you will not be surprised to find out that last week's diatribe against tax dodging was not definitive, nor the last to feature on this blog. Oh yes, there's more...

According to a report by the General Accounting Office of the USA, nearly a fifth of profitable USAian companies paid no corporate taxes in 2012, through fraudulent accounting. A method of such deviance that i didn't mention last week, is the misappropriation of transactions.

Basically, because they're not required to pay tax if they make a loss, then by taking a lossful year and pretending that some of the costs of that year didn't happen, they can be 'saved' for a sunny day, to pretend that they had a rainier one. Do you know what i mean?

Let's say a company made a $50mn loss in 2012, and a $50mn profit in 2013. By declaring a $1mn loss in 2012, they pretend that $49mn of it happened in 2013. And by shuffling $2mn of profit in 2013 over to 2014's accounts, they can pretend that they had a $1mn loss in 2012, a $1mn loss in 2013, and $2mn in a year that hasn't happened yet. But of course, the tax people aren't going to be shown any of this, so how are they going to know?

There's a range of such abuses of prepayment/accrual accounting like this, called 'financial statement fraud' of which this is just one type. There's nothing wrong with prepayments and acrruals when done right, but done wrongly, it's a method of deceiving creditors and debtors, and... evading tax.

And when it came to avoiding tax in 2015, Pfizer topped the rankings in an R.G. Associates study. It paid 55% less tax than it would have done if all of its profit were taxed at the USA's 35% rate. That's $3.1 billion they dodged! A higher proportion than any other company in their study.

Of course, economists and businesspeople alike lay the blame for this at the feet of the 'cripplingly high' tax rate in the USA. Even though the tax only applies to profit. So if you're paying it, you don't need it. It's not like income tax, where you pay it because it's your personal revenue - corporation tax accounts for expenses. If you could draw up a Profit & Loss account for your finances, you'd probably pay less tax too, just because of the way the system works.

Oh, and health care and technology companies based in the USA added $266 billion to their profits over 10 years, thanks to pretending to be in tax havens, around the world.

To give you an idea of the scale of the financial fraud that Apple alone has perpetrated, their bill is going to be somewhere around €19 billion ($21 billion) whereas the entire cost of bailing out Greece's debts (the entire country) is just €2.8 billion ($3.2 billion) making Apple's tax bill (which at 35% is really not that high) enough to buy Greece's debt six-and-a-half times over!

It all looks a bit grim for Apple, these days, doesn't it. I imagine they must be doing something to try to PR all the crime reporting away. Y'know - PR - the only thing Steve Jobs was ever good at. Oh, is that yet another new iPhone design? Is that a new watch that can't actually be taken underwater despite the name? Is that an entire media event full of mini-press-releases to draw people's attention away?

Hmm. Looks like they are trying. Good luck to 'em :-D


I think i missed it, but last week was The Naked Scientists' 15th anniversary :o)

And i know i missed the 50th anniversary of the first airing of the original Star Trek, on the 8th of September 1966. As a little tribute, astronomers have identified nebulae that, from Earth's angle, look like the starship Enterprise. You can see images of them enlinked under 'contemporary stuff'.

Some time recently, some CRISPR-Cas9 "genetic scissor" genetically-engineered vegetables were cooked and eaten in a public show-off, for the first time. The CRISPR-based (Clustered Regularly Interspaced Short Palindromic Repeats) genetic engineering technique was first published as a working technique in 2012. It's not yet known whether the anti-GMO mob will persuade anyone to ban its use, but it holds huge potential for making food more nutritious.

Here's one i haven't missed... yet. The 15th of September marks the 100th anniversary of the first use of tanks in warfare, at Cambrai, in the Somme, later designated as the Battle of Flers-Courcelette, when 36 Mark 1 tanks were used to advance the British front line.

In other news:

$21 billion to settle Apple's tax bill, $3.2 billion to settle Greece's debt, and $3.6 billion to save Ecuador's million-hectare Yasuni National Park, which contains hugely diverse Amazon wildlife, and some of the world's last uncontacted indigenous populations. Unfortunately, the last of these has also gone unpaid, forcing the President to permit the oil company Petroamazonas to start trashing it for crude oil. But a fall in oil prices has meant Ecuador's income has fallen, and the lack of international support has forced his hand. I mean, he'd have to be massively corrupt to have $3.6 billion squirrelled away, somewhere, wouldn't he. Even former Chinese Prime Minister Wen Jiabao (and his family included) had only extorted $2.7 billion by the time he got found out.

Various companies are up in arms, whining about proposed copyright reforms, by the EU. Some are awful, or just awfully poorly thought through, but even the sensible ones have received the same lambasting. Unsurprisingly, Google-owned lobby group OpenForum Europe opposes ancillary copyright, which would make it financially expensive to quote anyone, on the internet, especially the newspapers it's designed to defend. Google opposes it because they have to quote newspapers' web-pages in their listings, otherwise no-one knows what the article they'd be clicking to contained! But then, media broadcasting organisations (like Sky and RTL) have been whining too, about the idea that maybe they should charge a base rate for access to their material, and not be charging extra just because customers are, for example, in Croatia. The internet's the internet - it doesn't cost more to make it available to Croatians, so why should they be charged more? It seems very sensible, to me, to prevent this kind of buccaneering geo-blocking. Other objections run along common objections to copyright law, full stop. Period. .. I maintain that intellectual property should not be allowed to be owned by organisations - only the individuals who contributed to it. And not beyond their death, either. That reform would fix a lot that's wrong with copyright and patent law.

I'm used to seeing sexist, racist, naturopathic, and theological pseudoscience crop up on press release sites like but this one's a rarity. Katherine Dafforn, Mariana Mayer-Pinto and Nathan Waltham, writing for The Conversation, are apparently quite happy to nail their flags to the mast of Feng Shui fraud - a pseudoscience famously deriving from the Orient, that is predicated on superstitious beliefs in and about 'qi', 'energy', 'harmony', 'balance' and 'building health'. They claim that such superstitious baloney could and should help with marinology, and ecology and engineering. Not a chance! If we want to ensure the health of our environment and ourselves, we must evict these intellectual trespassers, or all our efforts will be compromised unnecessarily.

The second death in a Tesla car this year (and in all history) has been the second in which blame isn't attributed to the car's autopilot system. In the first case, the driver was shown to be a rather reckless driver who was speeding at the time; and in this case, the autopilot has shown to not be on when the incident happened. In fact, the car's logs show that it was doing 155 kph (96 mph) when it was driven into a tree, which is 32 mph faster than the car in the first fatal incident. So Musk's Space X might be a bit dodgy when it comes to spaceflight, but his cars are not to blame when they go bang.

It's a victory for corruption! Facebook routinely censors depictions of the human form (specifically certain bodyparts perverts don't like seeing) including the now-famous photograph of a naked girl escaping a napalm bombing, during the Vietnam War. But when Norwegian Prime Minister Erna Solberg decided to object, then after her photo was taken down through routine, it eventually got put back up again. Prime Ministers get to post nudes if they want to, it seems. I shan't fret about the asininity of the premier's ascerbic witticism "It shows that using social media can make [a] political change even in social media" but i shall take another stab at Facebook's aloof and prejudicial bid for "protecting the community" by maintaning the community's ignorance of its own bodies. Facebook has similarly censored a photo of Copenhagen's statue of the Little Mermaid, on the same grounds! Less surprisingly, though no less nonsensically, it's censored Gustave Courbet's painting 'L'Origine Du Monde' (The Origin Of The World) which depicts a map of tasmania... a ham wallet, a bearded clam, a cellar door, a front window, a happy valley, a gate of heaven, an itching jenny, a vertical smile, a cockpit, a bald echidna, a blown out tater biscuit, a ring-a-rang-a-roo... you get the idea, right? I'm not allowed to use the word 'cunt' you see :-P

Just weeks away from Rosetta's final rest, as it's spiralled in toward comet 67P/Churyumov-Gerasimenko, Rosetta has spotted the lander Philae, trapped against a cliff face. You can see the images at the first and second links below, or here. Rosetta hadn't been able to capture a photo of Philae since November 2014, but both had already sent years' worth of data to Earth. Rosetta is due to find its own landing spot on the comet on the 30th September, when it will complete its spiral course and crashland onto the cometary surface. Hopefully, sending back pictures all the way. You can find out a little more about Rosetta's dusty grave, and planned descent by clicking here, and about the cometary dust, by clicking here.

Yet another fossil discovery, marred by the stench of festering cryptozoology. There really has been an icthyosaur fossil revealed, having been discovered and eventually catalogued after 50 years sitting around, but there has never been the same discovery for a 'nessie'. Species are often classified, taxonomically, years and sometimes decades after discovery, simply because there are so many of them, and so few people to analyse them. They get shoved on a shelf somewhere, and passed by in favour of newer finds, and then half a century later, someone finally gets around to working out whether they're 'new' or not. Well, i suppose either 50 years or 170 million years can be old or new, depending on your point of view. But either way, nothing lived in Scotland 170 million years ago, because it didn't exist. Not the animal, the country. Unless you were thinking of a 'nessie' in which case neither did :-P

Archaeologists of the Mary Rose project have published 3D visual-light scans of ten objects found on the wreck of the ship, including a skull of a carpenter, whose osseous malformations provide clues to the life he might have led. You can go straight the scans page by clicking here.

Whether you know them as 'volatiles', 'essentials', 'odours' or 'perfumes', whiffy chemicals have a common property of miscibility in water. That means that they won't just linger on your body - they can collect in the environment, too. A study of 22 sites from the inner-city canals of Venice, out to the more rural areas, has found that 17 such volatile chemicals persist in the environment, 500 times more abundantly in the inner-city than on the edges of Venice. This includes chemicals known to be common subjects of allergies - immune malfunctions. Further research will be needed to quantify impacts from these chemicals' distribution in the environment.

Barack Obama is a parasite. No, seriously, he is. But he's not Kenyan. Baracktrema obamai, a tiny parasitic flatworm, lives while causing no obervable harm, in the blood of Malaysian Freshwater Turtles. It's deemed a huge honour to have a taxon named after you, but sometimes it just doesn't feel like one :-D

An imaging system in development at MIT can be used to read books without opening them. It uses infrared-to-microwave band light to look at and through the pages, and an algorithm to distinguish one leaf (page) from another, and to determine the shapes of the letters that are written on them. Even using 'books' deliberately pre-made to make the task easy, it can currently only see 20 pages into a book, and can only make out letters on the top 9 pages, but advancement of the technique could lead to a way to read texts inside codices that have stuck together through decay. If the contents are a curiosity, but the codex itself too fragile to open, this imaging system could be the solution.

------------------------------------------------------ contemporary stuff

'Why did the Falcon 9 Explode?'

{Musk is trying to frame it as an advanced problem, instead of a basic one}

'Coffee Cup Vibrations - Numberphile'

'Vorticella - Under the Microscope'

'Are GMOs Dangerous?'

'Checking Out Your Privates | The Checkout'

'As A Guilty Mum: Health Products | The Checkout'

'Punishing Doubt [cc]'

'Witnessing Jehovah'

'Weather, or Climate Change?'

'Image: Jupiter's south polar region'

'Mars rover Curiosity views spectacular layered rock formations'

'Image: Plankton bloom in the Barents Sea captured by the Sentinel-2A satellite'

'Image: 'Enterprise' nebulae seen by Spitzer'

'"T-Rump" by Roy Zimmerman'

'Joo sings to Igudesman "You are My Perfect Man"'

'The International Maths Salute with Dr James Tanton'

'Signs of the Time: Series 4 Ep 13 | The Checkout'

'10 more amazing bets you will always win! (new episode)'

------------------------------------------------------ of the weeks

Word Of The Week: osseous -- pertaining to bones, in shape, consistency, or other quality; unchanged from 15th century latin, and dating back to Proto-Indo-European as 'ost'

Fact Of The Week: It has been variously claimed that all the people of indigenous Australian ancestry are incapable of counting past '4' and that they all have number systems that can be used to count well past '4'. Both of these extremities are wrong. The number of populations that do not have words for numbers above four is very few, but not non-existent; so most have some form of counting system with which they can understand and convey higher numbers. Warlpiri and Anindilyakwa-speakers are restricted to words for 'one', 'two', 'few' and 'many' but Wardaman speakers concatenate numbers to go above 5, and have the word 'yigaga' for 10. Kuurn Kopan Noot speakers have the word 'peep' for 20, and the word 'baarbaanuung' for 100. Chaap Wuurong speakers have numbers up to 28, for days of the lunar cycle, corresponding to parts of the body, thereby naming all of those places at the same time as having gestural demonstrations of number. Despite all of this, Humanities academics still use the factoid that Aboriginals 'can't count past four' as an excessively-reductionistic generalisation and rhetorical remark, to shaw up their vapid extemporisations. So now you know, you can correct them. An element of confusion can be found in the fact that the Pirahã speakers of the Amazon have no words for number whatsoever. They have an intuitive understanding of 'less' and 'more', and 'some' and 'none' but nothing more than the intuitive comparative ability that many other species have been demonstrated to have. None of these peoples have been demonstrated to be incapable of numeracy - only of unwillingness, because they see no use for it.

------------------------------------------------------ non-contemporary stuff

'John Cleese Genes'

Monday, 5 September 2016

Entertainment stuff from the week 29/8 - 4/9/16

Hi pomme de terre de ciel de la portes,

It's week two of Applegate in the Big Brother house. The EU and the USA's Treasury are still squabbling, and Tim Cook's sent himself to the Diary Roooom.

Last week i mentioned that, the EU having launched a bid to get multinational companies to pay the tax they owe, the Treasury of the USA had had a little whine at the EU, because the USA's tax law says that USAian individuals have to pay USA-based multinationals' tax bills for them.

And, of course, tax collectors like the Treasury, act on the behalf of non-tax-paying corporations, not the actual tax-paying individuals, without whom they couldn't function. Because, reasons.

Well, the EU instantly repudiated the USA Treasury's claim that fair tax law is unfair, as if USAian companies are some of the biggest offenders, by stating that they're not biased against USAian companies - the USA's companies just happen to be the biggest offenders when it comes to tax-dodging.

This week, the whinges have been knocked up a notch in volume, and Apple & Co have been plugging in the surround sound audio system, so that everyone gets to hear it. They've deliberately sought the limelight, in the hopes of perpetuating their habitauated crime of dodging tax.

Apple is currently, and has been for the last four years, the most expensive company in the world. It's valued at $725 billion - that's twice as much as both Google and Exxon Mobil! Partly because of this, its tax affairs have been subject to particular scrutiny. How is such a huge, and profitable company, permitted to pay basement rates of tax? It's not like it needs the money. At the end of June , Apple reported holding $231.5 billion in cash, cash equivalents and marketable securities. The company held $214.9 billion of that amount in foreign subsidiaries.

Apple CEO Tim Cook has been hasty to claim that Apple has not been engaging in any dodgy tax activities, and that Apple actually pays a lot of tax. Well, Tim Cook, if i had a company worth $725 billion, i would expect to pay a lot of tax - a lot more than Apple does, because the amount of tax it pays is disproportionate to its size.

Cook's even claimed that if Apple's forced to pay tax, then 'job creation' will be negatively affected. But Tim, when big companies are got rid of, they're replaced with many smaller companies, who employ more staff. As i've said before, big companies are not the major employers - the myriad small companies are. Apple stores replace many smaller electricals dealers.

And frankly, if you're going to reiterate the nationalists' bollocks about 'sovereignty' then you can go shove your head up your arse (oh, you already have) because a pretty huge threat to the futures of local people, is a massive three-quarters-of-a-trillion dollar company that dominates international markets, and deliberately makes products that are incompatible with other manufacturers' products, soaking them dry by charging sky-high amounts for those products, and refusing to redistribute the wealth by paying even modest amounts of tax!!

Organisations like the Tax Justice Network have been investigating and documenting the dodgy tax affairs of multinational companies like Apple, Google, Facebook, and others on the tax hotlist, who use money laundering, and an abuse of the 'arms length principle' to avoid both the paying of tax, and the prosecution for tax evasion that should go with it, for years.

'‘Cash machine’ Apple creates poor societies'

{As the whole thing stems from problems with tax law itself, this is not peculiar to Apple, but they've taken centre stage on this, by their own volition, so they're going to get most of the grilling. But two years ago, popular gamer/youtuber Nerd³ paid more tax, on his own, than the entirety of Facebook in the UK! He was not the only individual on YouTube to achieve this tiny feat}

The thing about the USA's Treasury jumping in, and defending companies like the USA's egregious corporations, is both that it's selfish, and that it's performed through misplaced protectionism. Apple is not a USAian company. It's a multinational. Apple's products are not made in the USA. And its taxes are not paid there either. Apple is as American as British cars are British. And as British as Vodafone is.

Vodafone, by the way, has been in hot water for steadfastly refusing to pay more than £16 billion worth of tax. And the sloppiness of tax law in and outside the UK has meant that that quantity will probably never be collected. Like that Italian branch that paid-off the Italian treasury to get out of paying an extra €562 million that they owed. What was the name of that company? Oh yeah - Apple.

But how do they get out of paying tax? It's not just about deferring until the tax-collectors give in. Although it is partly about that. It's also about making tax collection incredibly difficult, so that people who might or might not be called Dave Hartnett decide that it's just easier not to bother doing their job.

Part of this ridiculous con job is to push the money from 'tax area' to 'tax area' so that the tax collectors of each area can't keep track of it, and just give up. This is why companies like Vodafone have completely empty offices in Luxembourg, or wherever they've chosen, that they visit one afternoon per year. I'm not making this up. By renting a room in a tax haven like Luxembourg (or Ireland, or wherever) they can pretend that Luxembourg is where their entire company is.

And this is where the problem of contradiction between 'American company' and 'multinational' comes in. Apple says it's an American company, to USAians, and to the USAian media companies, implicitly claiming that offshoring jobs is therefore OK, because it's basically still American, while telling the taxman that Apple is actually an Irish company, and so they have to pay tax in Ireland.

"Will you help a poor Irish company out, US Treasury? We really need the money. It's all potatoes and conies and stews out here. Help, it's awful. And Guinness. God, what is this stuff? Don't they have any All-American beer, like Budweiser? Oh, they do. I hope Bud's claiming rebates too"

According to the EU, Apple currently owes €13 billion ($14.5 billion) even on Ireland's low tax rate, because it had been pushing money around the 28 States of the EU in order to prevent any of the tax collectors in those areas from realising that Apple owed them money. And that figure should have interest on it, too.

That's 11 years' worth of tax, unpaid. This is what's so problematic with the 'arms length principle'. It's essentially legislated myopia. Tax collectors don't look beyond their national borders, because that means collaborating with the tax collectors of other countries (tax areas) and that means lots of extra work.

'Ghost HQ and Double Irish: Apple's tax deals'

This is how the EU has caught Apple! It's only because the EU is an international organisation that it can spot this abuse of tax law. Multiple EU States have been persuaded by powerful multinational companies; Amazon,  McDonald's, Starbucks and Fiat Chrysler included, to charge them minuscule tax rates, so that those companies can plunder their economies more cheaply.

Eire's tax collectors took just 1% of Apple's Ireland-registered money in 2003, but this already-tiny proportion had fallen to 0.005% by 2014. Ireland has got poorer and poorer since the recession of ~2008, so it's not like having Apple around is proving to be much of a boon. And yet Eire's government has announced that they don't want Apple's money! They're paranoid that Apple will leave. And why not? Multinationals moving in has bought out huge swathes of their economy. Non-Irish companies now employ 1 in 10 employed people in Eire.

In stark contrast, the industrialised tax evasion of multinationals like Apple, has benefitted them (the companies) on the order of tens of billions of dollars per year.

But it isn't only the multinationals that are to blame. Eire's government is relatively weak, but pollies in more powerful countries, that have the power to change the system for the better, have deliberately foregone such actions. In fact, they've condoned the tax-evading practice.

'Tax, Lies and Videotape: Private Eye’s report on corruption in Accountancy, from issue 1349'

Treasuries, tax collectors, governments, and accountancies, are colluding to perpetuate this problem, and have been for multiple decades. The bigger accountancies, usually UK-based (PwC, KPMG, etc) and some others (Baker Tilly, Blick Rothenberg, for example) are employed by the multinationals to fabricate a framework of tax regulations that are impenetrable only to themselves. This way, they can take five-figure sums from the multinationals, so that the multinationals can save six and seven-figure sums.

This tactic appeals to the pollies, too, because it means they appear to be doing something, and have contributed to a problem that the public couldn't possibly understand, and because it means that the high-up officials have companies they can retire to for years of devoted service... devoted service to the companies they retire to. The officials who are their juniors have to get used to this way of working, because if they whistleblow they lose their careers. The only way is up for them, as long as they kowtow.

No wonder Jack Lew, head of the US Treasury since 2013, has condemned the EU, accusing them of being "retroactive", while merely suggesting that "you (CEOs) need to be more careful when you think about only maximizing tax advantage... I have been very clear on issues like inversion, that it's legal but it's wrong". Remember that it's his job to collect tax from these companies, not from the EU. Why's he being more stern toward the EU than the companies that refuse to pay him the tax they owe?

Lew took $840,339 per year, and thousands in recinded mortgage payments for working at New York University, while claiming to support workers' union rights, having retired there from Bill Clinton's administration. And he left New York University to go to Citibank, in 2006, where he ran a hedge fund, profiting from the collapse of the housing market, and investing through various international branches of the bank. One investment in particular was Ugland House, which is a singular building in the Cayman Islands, where various multinational companies that want to chum up to the US Treasury, claim to base their operations. How many? More than 18,000. In one building.

Oh yeah, and he's with Cook, with the nationalist faux-solidarity: "The largest actions do appear to be aimed squarely at our tax base" ... it's "an attempt to reach in to the U.S. tax base to tax income that ought to be taxed by the United States". I presume you mean "ought to not be taxed by the United States", Jack. Apple doesn't pay tax to the USA. That's part of their deal with you. That's why 215 out of its 232 billion dollars in assets are designated as being outside the USA.

Not to be outdone in the quotes department, Tim Cook's heights of intellectual perspicacity have been "It's total political crap" which apparently passes for a witticism where he comes from. Add to that: "It's maddening; it's disappointing; it comes from a political place — it has no basis in fact or law". But then, it's your accounts journal, so what are you gonna do? :-P

Apple is one of many USA-orbiting companies to contribute to the multiple trillions of US dollars held offshore, supposedly 'waiting' to be 'repatriated' when the USA's corporation tax rate goes down. Imagine if you said you weren't going to pay income tax, this year, because you were waiting for another year when the tax rate were lower! You would be arrested for tax evasion, no doubt. So how are multinational companies allowed to get away with it? Corruption. The excuse is that the money is intended for 'investment' and 'job creation' but in the past, decreases in tax rate have only presented evidence of benefits to shareholders and investors.

{Note: some mad people insist that the term 'incorporated' should be taken literally and that companies should be treated like people. So, doesn't that mean they should be paying income tax? No? I wonder why - it might be because income tax is much higher than corporation tax}

{Second note: if there really is evidence that low tax rates lead to higher 'investment' and 'job creation' then that evidence should be abundant. Research is cheap, and the multinationals who claim it should easily be able to afford it. The only conclusion, given that the evidence is not forthcoming, despite how easy it should be to find, is that the corps are bullshitting us}

So what's the solution to all of this? The answer is here: scrap the current method of tax allocation (by vacuous location 'registration') and abolish the arms length principle. Location of activity is what is real, and what matters. The technology to do this exists, and can be done now. The only problem, is that it means powerful tax-evaders like Apple will find it a lot, lot harder to dodge their tax bills.

'Taxcast Extra: What is Unitary Tax?'


The 5th of September marks the 70th anniversary of Freddie Mercury's birth. Perhaps to commemorate this, a blue plaque has recently been put on his former home, in []. Of course, Brian May did a little speech at the unveiling.

'Freddie Mercury - Remembered With A Blue Plaque'

And if you're in time, here's the link to the live 70th birthday gig, raising funds for the Mercury Phoenix trust: 'The Queen Extravaganza Live at Freddie Mercury's 70th Birthday Party in Montreux'

The 6th of September marks the 350th anniversary of the end of the Great Fire Of London, in which more than thirteen thousand of the buildings of London were razed to the ground. A newish website has been made for those who wish to explore the event, linked here.

In other news:

An international team of biologists has discovered that two regions in the genome of the Tasmanian devil are changing in response to the rapid spread of devil facial tumor disease (DFTD), which is a nearly-100% fatal cancer first detected in 1996, that is caused by a pathogen transmitted in the Devils' saliva. This means they spread it as part of their fighting displays. Five of seven genes in the two regions were related to cancer or immune function in other mammals, suggesting that Tasmanian devils are indeed evolving resistance to DFTD. By picking out specific genes, researchers can find out how to accelerate the Devils' evolution, and hopefully save them from extinction.

A member of the Norwegian Environment Agency is claiming that 323 caribou have been killed by a lightning strike. They do tend to huddle very closely together, so a lightning strike could have hurt them all simultaneously, but i'm still doubtful. A cause like lightning is probably high on the suspect list, considering the environmental conditions, and the spacing and physical appearance of the victims. Details of internal burns would provide confirmatory evidence, in the case of a lightning strike.

Sticking with the electrical theme, the ampere - the SI unit of current strength - is due a revamp. Past definitions have been difficult to validate in practice, or entirely hypothetical. Under the name 'abampere' the original definition was "the amount of current that generates a force of two dynes per centimetre of length between two wires one centimetre apart"; the 'international ampere' was later declared to be "the current that would deposit 0.001118 grams of silver per second from a silver nitrate solution" but this was later found to be 0.99985 A, not 1 A. Since 70 years ago, the theoretical definition has been: "that constant current which, if maintained in two straight parallel conductors of infinite length, of negligible circular cross-section, and placed 1 meter apart in vacuum, would produce between these conductors a force equal to 2 x 10–7 newton per meter of length". But the amp is due a revamp, and by 2018 it should be adequately defined, with a good degree of (un)certainty, by the flow of charge carriers, instead of by the force between two adjacent wires. This certainly makes much more sense to me. You can use the equation for drift velocity to see that this nicely interprets the meaning of current. If this is approved, the new definition of an ampere will be: "one ampere is approximately equivalent to 6.2415093*10^18 elementary charges moving past a boundary in one second".

An individual has been given 4 years 4 months in prison, for releasing private emails, medical data and financial information. The same acts committed by a company receive no penalty at all, except the occasional three month suspension, and no criminal record.

Do you remember the wet-fish of a climate deal that was first signed in December, last year? The Paris Climate Agreement. Well, the USA and China have finally officially signed it. So that's a thing.

Diversification and homogenization - that's what we've seen with big companies operating on the internet. YouTube does chat (Google+) Facebook does photos and videos, Instagram does lunch and videos, and Twitter does photos and now videos. They've developed a function for users to upload them, and most importantly, choose whether to monetize them or not! Because what everyone wants on Twitter right now, is yet more advertising making you think "I didn't know Sarah shopped at Tesco. Oh, oh right. It's an ad". But by diversifying into all the areas that the other companies do, they're homogenizing the internet market, and [coughs cynically] diluting their brand. Who knows, in two years' time we might not even think of Twitter as being a tweet-site at all. The idea of a 140-character limit will be as old-hat as Myspace.

The University of Washington and The Nature Conservancy have come together to create an animated map of the directions of migration that species are likely to take, as climatic change in the anthropocene (the current geological era) advances. The map is based on observations of, and extrapolations from, the migrations of nearly 3,000 species assayed in a study. Some of the routes are unsurprising, as species are expected to move away from drying regions, to more bearable environments; but some are less intuitive. Perhaps they will prove to be wrong, or maybe the data reflects judgments on the species' parts, that are difficult to recreate in our ignorant heuristics. The map is currently only available for the North and South American continents, and can be seen here.

It's a new galactic record. Galaxy cluster CL J1001+0220 lies 11.1 billion light years from Earth - the farthest any galaxy has ever been seen, to date. The observation of the eleven-galaxy cluster pushes back the start date of such structures' formation in the universe, by another 700 million years.

A lot closer to home, ESA has release before-and-after images of a solar array on one of their satellites - Copernicus Sentinel-1A. The images show the hole left in the array by the impact of a millimetre-scale particle. Using onboard cameras, engineers have determined that the damage zone is about 40 centimetres in diameter, but ESA has stated that less than 5% of power has been lost due to the impact. Such damage is expected of a body orbiting above the atmosphere, as dusty particulates are constantly flying through intra-stellar space, as well as debris left as a result of damage to orbiting equipment. ESA's debris office head estimated that the observed impact had a 1:35 and 1:130 chance of happening during the satellite's projected 5-year lifetime. The ~1 gram particle could have been travelling at ~40,000 kilometers an hour when it hit. This website maps all of the known objects that orbit Earth, including many of the known fragments of debris. It's worth a look.

------------------------------------------------------ of the weeks

Word Of The Week: inextricable -- incapable of being extricated, disentangled, undone, loosed, solved, or removed from, something; describing a problem that is beyond solution, hopelessly intricate

Quote Of The Week: “The depressing thing about tennis, is that no matter how good i get, i’ll never be as good as a wall” – Mitch Hedberg

Fact Of The Week: There should be no such thing as Women's Kayaking in sporting events, because the word 'kayak' is Western Canadian Inuktitut for 'man's boat'. Therefore, the ladies' event should have a different name

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